Carbon footprint

Focus on measurement methods for carbon dioxide emissions

AP1 supports the development of new methods for measuring climate impact. The Fund considers climate issues as an integral part of its investment operation.

When it comes to climate issues, an important aspect of sustainability, there is a global commitment to limit carbon dioxide emissions.

AP1 works with others in various ways in this field, including through Climate Action 100+, a global collaborative initiative for investors. The goal is to influence the 100 companies deemed to have the greatest carbon footprint to work to the objectives of the Paris Agreement, reduce greenhouse gas emissions and improve their openness on climate-related reporting.

Climate a key issue

By working together with other players globally, and by contributing to new measurement methods, AP1 is helping to improve climate work.

Measurements a challenge

AP1 annually measures the carbon footprint of its holdings in equities and corporate bonds. Since current measurement methods need to be developed, the Fund takes a very positive view of developing new methods for measuring emissions. For instance, existing parameters do not consider the entire life cycle. Nor do they reveal anything about how well prepared the companies are, or how their footprint will change in the future.

Relevant measurement methods pave the way for improvements, both in the overarching climate work and in the Fund’s own investment decisions.

The AP Funds’ carbon footprint

Four indicators have been chosen as a basis for the AP Funds’ combined reporting of carbon footprint. Three of them are calculated based on the Funds’ holding percentage in the companies.

The following indicators are included:

Absolute carbon footprint for the equity portfolio equating to the owned share of the companies’ aggregate emissions (tCO2e).

Carbon intensity, in which the absolute carbon footprint is related to the share of ownership of the companies’ market value (tCO2e/SEK m).

Carbon intensity, in which the absolute carbon footprint is related to the share of ownership of the companies’ turnover (tCO2e/SEK m).

Carbon intensity, weighted average, where the companies’ carbon intensity relative to turnover is multiplied by the company’s percentage of the portfolio based on market value (tCO2e/SEK m)

The carbon footprint is calculated for holdings as at 31 December in the current year using the latest available CO2data for direct emissions (Scope 1) and indirect emissions from energy (Scope 2). The figuresfor the different AP Funds are not fully comparable.